Friday, 31 August 2007

Rudco, Rudco, Rudco, oh what are you people doing! Firstly, never screw with peoples money it will always bite you in the ass! Secondly, trusting a company with what is most likely going to be your single biggest investment in life into a company that has no SOLID financial backing, SILLY!

As you may or may not have heard, RUDCO are now under investigation. Much like their predecessors FINBOND who themselves were given a good scolding years back when they decided to charge people for bond origination services, when this clearly went against all credit regulators and laws...

According to Moneyweb "On Thursday the NCR announced that it had found Rudco had contravened a number of provisions of the National Credit Act (NCA), and its predecessor, the Usury Act. One of the major contraventions of the law was Rudco's policy to accept payments for loans before they had even been granted.".

I don't want to be the one to say this, but, I TOLD YOU SO! It was inevitable! Unfortunately though, there are those people who have now found themselves in a bit of a predicament should Rudco's doors close down.

If you find yourself in a sticky spot or you need some Free Financial Advice, please don't hesitate to contact Wizard Home Loans on 012 341 2223.

Hello all... So good to see that people are still reading the SA Property BLOG, and we're proud to say that it's now the number 1 portal and information station for all South African property and finance related information.

Seen as the only ongoing and exciting news in the world of property right now is the national credit act I though we'd put together a little list on how to manage your debt responsibly. We get endless phone calls and email from people asking us about credit issues that they have, and personal loan debts and it's quite sad to see that so many people are in the financial dilemma's that they're in...

So once again in an effort to help South Africa become and debt free society here's the TOP 10 yes TOP 10 debt management tips and hints that help people Manage Their Debt Responsibly.

Avoid Making Impulse Purchases - If you don't have the extra cash to blow, avoiding blowing it. Instant gratification is all fine and well but it ain't that great when that bill arrives and you realise you can't afford it

Speak to your creditors - When you're in financial SHIT, speak to your creditors, tell them the predicament you are in and come to a mutual agreement and understanding, even if it means dropping your monthly payments. Missing payments will affect your credit ratings.

Get credit only from Registered Credit Providers - Stay away from loan sharks unless they are registered.

Always make your monthly repayments by your due date - NEVER MISS EDGARS ACCOUNT REPAYMENTS. These guys will list you in 2 ticks...

Pay off your credit - Any extra money that you have at the end of the month, use to pay of your credit. If you have, put this cash into your bond account. At 13.5% interest you won't get better rates anywhere else.

Kill your small account first - Alot of people say kill the loan with the highest interest rates first (normally your bond account) but I'd suggest killing the smaller ones quickly, thus reducing the amount of accounts to pay off.

Moving Debt - Don't move short term debt to long term debt to increase your monthly cash flow, your interest rates will increase

Don't stand surety for anything unless you can handle it - This is a killer. People sign surety for other people without realising that they become responsible for repayments should the other person for whatever reason not be able to pay. WATCH OUT!

Live within your means - Don't over commit.

Know your credit ratings - Check yourself out at least once a year. You can get a free credit check on your birthday from the credit bureaus. Otherwise Wizard can get you credit checks for a price of R125.00. See Credit Checks for more information

Sectional Title Register

This topic covers the definition of a register, the application for opening of the register, its legal effect on the real property and real rights involved.

1 Description of the sectional title register

When the scheme is registered and the land register closed, a sectional title register is opened. In this register a copy of the sectional plan is kept and all the documentation lodged for the opening of the register.

All rules, scheme notices and other body corporate documents are kept in the register for the scheme. There are two files in each sectional title register, one has all the sectional plans and the other has all the documentation.

In terms of section 11(1) of the Act a developer may, after approval of a draft sectional plan by the Surveyor‐ General, apply to the Registrar of Deeds for the opening of a sectional title register and the registration of the sectional plan.

3 Effect of registration of sectional plan

Section 13 of the Act deals with the effect of registration of sectional plans:

the buildings and the land shown on the plan are legally divided into the sections and common property shown on the plan;

the plan, together with all the supporting documents filed for the opening of the register, are deemed to be part of the title deed for each unit in the scheme;

the sections and common property are subject to any servitudes which burden or benefit the land shown on the plan as well as to any conditions imposed by the developer on opening the register; and

any mortgage bond, lease or other limited real right which previously burdened the land is converted so that it burdens the sections and common property shown on the plan.Section

This topic explains what a 'section' is and gives examples, it explains how the boundaries of a section are determined and covers the implied servitudes that operate as between sections and between sections and common property in the scheme.

Section

This topic explains what a 'section' is and gives examples, it explains how the boundaries of a section are determined and covers the implied servitudes that operate as between sections and between sections and common property in the scheme.

1 Description and definition of a section

A section is the area of air, brick and mortar that is exclusively owned by the owner of a unit in a scheme. A section is defined in section 1 of the Act as follows:'section' means a section shown as such on a sectional plan;

2 Explanation of a section

A section:

Is exclusively owned (as opposed to the common property which is owned in undivided shares), but is still subject to various servitudes and access rights in terms of the Act;

Is defined as extending to half the depth of walls/ floors/ ceilings et cetera;

Is measured by floor area ‐ the nearest square metre and to the mid‐ line ('median line') of its boundaries;

Is shown on sectional plan ‐ look for the solid lines that indicate the boundaries of sections; and

May include an adjoining open area, e.g. balcony or terrace, or a built‐ up backyard or noncontiguous parts of the building like a garage numbered the same in the cellar of the building.

Visualise a typical cavity wall made up of two single‐course walls built on the same foundation and tied together. If this is the boundary of your section then the material you own extends to the mid point of that wall.

The paint covering inside, the inside plastering, inner course of bricks and half the air‐space are your responsibility. The body corporate is responsible for the other half of the cavity, the outer course of bricks and the outside plaster and any exterior paint covering.

Windows and doors set into the outside walls of sections do not define the boundaries. Whether the material which makes up the door or the window is part of the section or part of the common property is decided by reference to the walls that surround them.

3 Implied servitudes of support and access

In section 28, the Act provides for servitudes of support and access. The purpose of the servitudes of support is to keep the physical structure of the building intact since the building with its walls, floors and ceilings form the basis of sectional ownership. Without a building there can be no sectional ownership.

Therefore the structures of the sections below must support the structures of the sections above them (servitudes of subjacent support) and the structures of the sections or common property adjoining a section must support that section (servitudes of lateral support).

These servitudes are reciprocal with the one being supported and simultaneously lending support to the other. The purpose of the servitudes of access is to ensure that all the facilities in the scheme work properly. Therefore wires, pipes and ducts serving different property should be allowed to pass unhindered through the various sections.

Each section is automatically subject and entitled to:

a servitude for vertical and horizontal support of the section by the common property and by any other section which can receive/give/ such support;

a servitude for the passage of water, sewerage, drainage, gas, electricity, garbage, heated or cooled air and other services, including telephone, radio and television services, through any pipes, wires, cables or ducts that exist on or under the land or in the building.

These servitudes are deemed to be incorporated in the title deeds of the owners.By reason of these servitudes the body corporate is entitled to have access to each section and the exclusive use areas during reasonable hours to maintain, repair or renew any part of the building or any pipes, wires, cables or ducts.

NCA - an impact thats defintely changed to 21,5% in June to private sector loans.

The JSE has tanked over 4% as global markets roiled amid a credit scare, with one UK economist calling it "pure panic". I agree totally.

Interestingly, the bank's Monetary Policy Committee meeting is taking place against the backdrop of worrying jitters on international financial markets prompted by worldwide credit concerns. Emerging markets, including South Africa, were not spared by this volatility, with the Johannesburg Securities Exchange closing in the red and the rand weakening to a four-month low. This bodes well for South Africa in the medium term, but it could be a rough ride in the short term.

Sectional Plan

2 Description of a sectional plan

The main aim of a sectional plan is to show the division of the land and the buildings comprised in a sectional title scheme into sections, common property and exclusive use areas.

The sectional plan will be the legal source for discovering the exact boundaries of sections, the common property and exclusive use areas.

3 Features of a sectional plan

Section 5(3) of the Act requires that a draft sectional plan must:

show the boundaries of the land (the sheet showing these boundaries is known as the 'block plan'and is normally sheet No. 2);

give the name of the scheme;

include a scale plan of each storey in the buildings;

define the boundaries of each section and give each one a number;

show the floor area (measured to the median line of the boundary walls of each section), correct to the nearest square metre, and the total of the floor areas of all the sections;

show any exclusive use areas.

3 Boundaries of and between sections

Sub‐sections 5(4) and 5(5) deal with section boundaries which are defined on the sectional plan as follows:

the common boundary between any section and another section or common property is the median line of the dividing floor, wall or ceiling, as the case may be.

the boundaries of a section shall be defined‐

by reference to the floors, walls and ceilings thereof, or as may be prescribed;

in respect of a part of a section (such as a stoep, porch, balcony, atrium or projection) where boundaries cannot be defined as above but which are appurtenant to a part of that section which can be defined in terms of that paragraph as prescribed.

‘prescribed’ means prescribed in the regulations to the Sectional Titles Act

Definitions:stoep ‐ a terraced veranda in front of a house;a porch ‐ a covered approach to the entrance of a building;a balcony ‐ an external balustraded platform with access from an upper‐floor door;an atrium ‐ the central court of a Roman‐style house; anda projection ‐ an additional part of a section which protrudes from the section.

From 1 October 2007, buyers of immovable property are required to withhold "advance taxes" (for CGT - Capital Gains Tax) where the seller is a non-resident.

ALL buyers where the purchase price is R2m or more should now establish whether the seller is a resident or non-resident - not doing so could land you with a hefty liability to SARS.

If you fail to withhold the tax, you become personally liable for it.

Having to double pay between 5% and 10% of the purchase price will be extremely painful.

The scale varies according to whether the seller is a natural person, company or trust.

The percentages are as follows:- 5% for a party who is a natural person;- 7.5% for a party which is a company; and- 10% for a party which is a trust.

It can also be hard to determine whether or not a seller is a "resident" for tax purposes, so you would be well advised to have the sale agreement professionally checked to ensure that it contains clauses to safeguard your position, including-

The seller's written warranty as to his/her/its residence status, and Authority for your attorneys to withhold the applicable percentage if the seller is a non resident or if there is doubt as to what that residence status is, etc.

Estate Agents must also be alert to this danger - they are at risk, not only of losing their commission, but also possibly of incurring liability to the parties.

Primarily the obligation is that of the purchaser however the agent is the agent for the seller and if the agent fails to ascertain the status of his client and the purchaser is assessed by SARS the act places a liability on the agent.

Friday, 10 August 2007

As promised here comes the first of our new Free Online Property Courses.

An initiative by Wizard Midrand home loans.

Scheme

This topic looks at the concept of a 'development scheme'. It covers the underlying definitions, the approvalprocedure, building compliance and residential tenant protection.

1 Sectional Title Scheme

A sectional titles scheme comes into being when conventional land and buildings are 'developed' under the Act as a 'scheme', or 'development scheme'. This happens when a developer decides to divide the land and the building(s) on the land into sections and common property by opening a sectional title register for the land and the building(s).

At this stage the entry in the land register for conventional land is endorsed to the effect that the land is included in a development scheme under the Act and no further entries are made in the land register.

2 Approval procedure

Section 4 of the Act covers this aspect. A developer who wants to develop a sectional title scheme must make sure that the land on which he wants to develop the scheme is situated within the area of jurisdiction of a local authority and that the building which he has erected is of a permanent nature. He must then instruct an architect and a land surveyor to ascertain whether the land and the building comply with any operative town‐ planning requirements and whether the building has been erected in accordance with valid building plans.

In case of non‐ compliance the developer would have to apply to the local authorityconcerned (municipality) for condonation of the defect. This means that he must ask the municipality concerned to excuse or disregard the defect. Should he want to convert an existing rental building to sectional titles, the tenants in the building must be given certain information and a right to purchase their sections before he can proceed. He must then instruct the architect and land surveyor to prepare a draft sectional plan showing the division of the land and buildings into sections, common property and exclusive use areas and to submit the plan for approval by the Surveyor‐ General of the region where the property is situated.

Once the sectional plan is approved it can be submitted to the deeds office for registration.

3 Requirements for approval of a scheme

Section 4 of the Act provides that:

A developer who intends to establish a scheme must arrange to have a draft sectional plan submitted to the Surveyor‐ General (the sheets of the plan can be prepared by a land surveyor and an architect can prepare all sheets except for the first, the 'block plan');

There can be more than one building and more than one piece of land in a scheme and separate pieces of land do not have to be adjoining

A building must not extend over the boundary between two pieces of land unless they have been notarially tied. A 'notarial tie' is created by registration of an agreement executed before a Notary Public to the effect that the two properties cannot be separately dealt with.

4 Residential tenant protections

Sections 4 and 10 of the Act make extensive provision for the protection of residential housing consumers (tenants) during the process of the development of existing leased buildings (rental apartment buildings) as sectional title development schemes.

Tuesday, 7 August 2007

Happy Tuesday morning to you all... Why am I so happy you may ask yourselves, well firstly my website is finally averaging over 100 hits a day. I know it doesn't sound like alot but I'm ecstatic.

Secondly I found out that Thursday is a public holiday in South Africa, which means SA Property gets to play golf of Thursday morning. Wooohoooo....

Thirdly, after much debate and chatting with the powers at be, SA Property will be putting together the first FREE ONLINE PROPERTY COURSES. This will include manuals and course material for South African property buyers, South African property sellers, South African mortgage originators, South African property attorneys and anybody else interested in property laws, regulations and the like.

It's an initiative that I hope will make SA Property Blog the number one Property BLOG in South Africa for good informative material and real estate related news. If there's anything you'd like me to add or would like us to discuss please feel free to comment on this post.

Thanks to all involved and keep posted people, it's going to be awesome!

Wednesday, 1 August 2007

Your Property woes are gone. Finally, an initiative, maybe even a world first from the owners of Gravity.co.za, South Africa's first property search engine.

An article from the owners of Gravity.co.za...

"For quite a while we've wanted to provide our users with an area-type search feature where they could see, at a glance, all the houses in a particular area/within a given radius.

Most real estate property sites overseas would probably implement it as a map, but since South African agents don't provide street addresses for their listings and reliable street/area information biased towards real estate (e.g. that include estates, brand new road and suburbs that are continually appearing) is not really available, map searches are not an option.

There just seemed no way we could get something useful out until we suddenly realised that we had hundreds of thousands of users who had been telling us exactly what suburbs they thought were relevant to them. South African users are patient and diligent when looking for property due to the lack of user-friendly search capabilities like Google Mashups etc. They had given us really great data to analyse for trends. We ran a few basic algorithms to answer the question "if a user is interested in property in suburb X, what other suburbs will he/she most likely search" and the answers/correlations we got were just incredible. We optimised the algorithm and extended it to "if a user is interested in property in suburb X, Y and Z what other suburbs will he/she most likely search" which was launched on 1 August, try it out for yourself:

go to the Gravity Property Index homepage - www.g.co.za and enter the suburbs you're interested (comma separated) in in the Quick Search Text box. Select your price and hit enter - you'll see at the top of the results page that is returned, a list of recommended suburbs.

The powerful thing about this feature is that it's changed the search results from 'nearby' to 'most relevant'. GPS/map-based solutions have 2 shortcomings which 'most relevant' solves:

1. "Other side of the road". Often more expensive ('X') areas border on lower cost areas ('Y') and on map-based/radius searches both will be included in search results. It was quite interesting to us that although people looking for houses in X would never specify Y in their search (as you'd expect), the converse was not - people searching in Y would search a house in X. Intuitive I guess but satisfying to see 2 completely different result sets. If you're familiar with Cape Town, try a search for Rondebosch (X) and compare it Athlone/Rondebosch East(Y) - they border one another and even sound the same, but the relevant suburbs are not at all similar

2. "Similar Suburbs across town". It seemed buyers were interested not only in the location of a suburb, but its overall profile e.g. property values, great views / location next to the sea, near schools A OR B (across town from one another) etc. Area searches don't correlate 'LIKE' suburbs, just ones close together. Just as important we found was that, in a region with say 10 suburbs, often 3 or 4 would be LIKE, so the user would not have to search all 10 to get the houses in the most relevant 3 or 4.

And this was only possible thanks to the information contained in the minds of our visitors - keep searching!